Over £8 billion to be invested in water industry this year as bills rise by less than inflation

Customers

1 February 2018

Water companies in England and Wales will invest more than £8 billion in 2018-19. The investment comes in the fourth year of a £44 billion spending commitment from 2015 to 2020. Over that 5-year period, the funding will ensure that more than 370 million litres a day is prevented from leaking from pipes, nearly 5000 fewer properties will be flooded with sewer water, and there will be cleaner water at more than 50 beaches.

The reduction in leakage and the increased promotion of water efficiency will save the equivalent of the water used in a day by all the homes in Birmingham, Manchester and Leeds.

The average household water and sewerage bill in England and Wales for 2018-19 will rise by less than inflation, and will help the ongoing investment. The new average bill will be £405 – a below inflation rise of £9 (2%) compared with the provisional figure for the previous year.

Next year’s below inflation change to average bills is in the context of an overall cut in bills of 5% in real terms between 2015-2020 as part of 5-year plans developed in consultation with customers and confirmed by the industry regulator, Ofwat, in 2014.

Water companies are also on track to deliver on a 5-year commitment to deliver financial support to an additional 1 million people (459,000 households) by 2020, with all companies having social tariffs in place to provide reduced water bills for customers who struggle to pay. At the beginning of 2017, the industry reported to the consumer body, the Consumer Council for Water, that they had already delivered financial support to an extra 780,000 people (338,764 households) in less than two years, and that they fully expected to meet the total additional 1 million target. This means that by 2020 the industry will be helping around 1.8 million people to pay their bill.

The water company investment plans will be paid for by average bills of just £1.11 per day for an entire family – less than the price of a litre of bottled water from a shop. For that, they get as much water as they need, produced to world-class drinking water standards, with all the waste water and sewage being taken away from properties and treated in a way which reduces harm to the environment. Companies are providing essential infrastructure, supporting better services, greater resilience, and environmental improvements. Some of the examples of investment by water companies include:

In West Cumbria, United Utilities is building a £300 million water supply scheme to connect 150,000 people in communities including Whitehaven, Workington and Cockermouth into the North West regional water supply grid. The scheme is designed to ease pressure on environmentally sensitive local water sources like Ennerdale Water, and provide a resilient, long-term supply for the area. The project will see the construction of around 100 kilometres of pipeline, plus associated infrastructure including a new water treatment works, two service reservoirs and a pumping station, linking West Cumbria to Thirlmere Reservoir. Work on the scheme began in Spring 2017, with the project due to be in service by March 2022.

Wessex Water is continuing to invest around £15 million in building a new sewer which will ensure that the area’s system copes with ongoing and future development in North Bristol and South Gloucestershire. Once built, the sewer will divert waste water flows from South Gloucestershire to Bristol sewage treatment works in Avonmouth via a route around the north of Bristol, rather than alongside the Frome Valley and through the centre of Bristol. Diverting the flows will provide additional capacity for the new in areas such as Yate, Emersons Green, Bradley Stoke and Filton, where thousands of new homes are being built and significantly reduce the risk of sewer flooding in the area. The project started in 2017 and is due for completion by the end of 2018.

In 2018, South West Water will commission and complete a new £60 million state-of-the-art water treatment works to serve Plymouth and the surrounding area. The new Mayflower Water Treatment Works will harness first-in-the-UK technologies and innovative water treatment processes. The new technology feature will help deliver even cleaner water more efficiently, helping to keep customer bills down.

Severn Trent is continuing to invest in a £300 million scheme to provide a back-up supply for over a million customers in the Birmingham area. The project started in 2015 and is scheduled to be operational at the end of 2019. Birmingham’s water has been sourced from Wales via the Elan Valley Aqueduct (EVA) for around the last 100 years. The scheme allows maintenance to be carried out on the EVA for up to eight weeks a year if necessary while still serving demand in the Birmingham area. It will also provide more options should there ever be a problem with Birmingham’s main source of water – the city will have two sources of water instead of one.

Water UK Chief Executive, Michael Roberts, said:

“We know that households are under financial pressure in a number of ways. Even though the cost of water and sewerage is much less than other services, it all adds up, which is why water companies are doing everything they can to keep bills as low as possible while keeping up huge levels of investment.

“Our customers deserve a world class service, and we’ll continue to provide it – giving people some of the best water in the world, cutting leaks, improving the environment and helping customers who struggle to pay their bills.”